Lynas chief prepares to meet angry shareholders

AFTER promising investors at last year's annual meeting that they would be ''celebrating the reality of production and sales'', the executive chairman of Lynas, Nick Curtis, will this morning face frustrated shareholders at its annual meeting still dogged by extended delays and a share price near two-year lows.

''This time next year I will not be reporting to you the sales we are about to achieve, but rather celebrating with you the reality of our production and sales, and speaking again of the huge potential of our business,'' Mr Curtis said at last year's meeting.

Shares in Lynas rebounded 8¢ to 63.5¢ on Monday, but remain near the two-year lows it plumbed last week, after it was forced into a $200 million capital raising following extended delays to its processing plant in Malaysia.

The Australian Shareholders Association has recommended shareholders vote against the remuneration report, labelling some payments as ''excessive''.

Lynas, with its massive Mount Weld deposit in Western Australia, is closely watched by investors as a potentially key player in breaking China's monopoly on the production of rare earths.

The delays to its processing plant have been in part due to a series of legal challenges from a band of Malaysian environmental activists, who are expected to travel to Sydney for today's annual meeting. The activists have lost each claim so far and are being sued by Lynas for defamation.

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But the delays and resultant volatility in Lynas' share price has tested the patience of some investors.

The Australian Securities Exchange and the Australian Securities and Investments Commission are understood to have received complaints from Lynas shareholders over a large volume of shares that changed hands on November 8.

In the space of 15 minutes, close to 25 million shares changed hands - a figure well-above the daily average. The trades were completed after a trading halt was lifted at 3.55pm following a court injunction that was lifted in Malaysia. But shares in Lynas entered another halt before morning trade on November 9, announcing the dilutive and market-sensitive capital raising.

A spokesman for Lynas said it informed the ASX of the court's decision at 3.32pm and it was up to the exchange to decide when to lift the trading halt.